Sindh CM wants federal govt to take responsibility for K-E's failure

Murad Ali Shah urges Centre to delink disputed claims among different entities from gas supply to K-E

KARACHI: Chief Minister Murad Ali Shah, in a reply to a letter by Federal Energy Minister Awais Leghari, said that the Karachi Water and Sewerage Board (KWSB) has a claim of about Rs18 billion against various federal government entities operating in Karachi, which is not being paid despite several notices. Therefore, Shah requested that the issue of disputed claims amongst different entities be delinked from the additional gas supply to K-Electric (K-E).

The CM referred to Leghari's letter of April 20, in which the energy minister acknowledged that the current power crisis being faced by the residents of Karachi was the result of mismanagement, system inefficiencies and commercial mishandling by K-E.

"You [Leghari] have mentioned that Nepra [National Electric Power Regulatory Authority] has clearly highlighted these issues in its report on the current electricity crisis in Karachi," Shah's letter read.

"Let me state that the government has to take responsibility for the failures of K-E as it privatised the entity without any consultation with the then Sindh government and entered into contractual arrangements with the private party, while keeping the Sindh government out of the process," the letter read. The CM deplored that the Sindh government was not even provided a copy of the Implementation Agreement (IA) signed by the federal government with the private party.



Shah said that a copy of the IA, which was subsequently obtained by the Sindh government after hectic efforts, showed that the responsibility of regulating the private sector monopoly, K-E, lies with Nepra. If Nepra's report regarding mismanagement and non-utilisation of idle capacity by K-E is an indictment against K-E, it is also a charge sheet against Nepra itself, which has failed in discharging its duties as an effective regulator, he said.

The CM, in his letter, said that Karachiites have been suffering not only on account of the mismanagement of K-E but also due to bad regulation by Nepra. "As far your contention regarding outstanding dues of KWSB to K-E, let me make it clear that these dues are for the period where the IA was in effect. As I have explained, the Sindh government was not a party to the IA and the federal government has on its own guaranteed the payments of KWSB," Shah's letter read.

He said that the Sindh government could not be held responsible for the payments.



"I may also bring to your notice that after the termination of the IA, we have ensured that KWSB pays the bills of K-E on time. Moreover, the KWSB has a claim of about Rs18 billion against various federal government entities operating in Karachi, which are not being paid despite several notices," he wrote. The CM said Leghari's letter as well as Nepra's report on the current crisis revealed that the immediate resolution to the problem lies in providing additional gas to K-E.

"I urge that the issue of disputed claims amongst different entities be delinked from the additional gas supply to K-E," he said.

He urged the federal minister that the residents of Karachi should not be made to suffer because of the inefficiency and incompetence of utility companies, regulators and the government.



Shah said he has already requested the prime minister to act immediately as the resolution of this dispute is the responsibility of the federal government. "I urge your good self to do the same as the situation is getting from bad to worse with each passing hour and further waste of time on this account will not only add to the misery of the people of Karachi, but may also result in a major law and order issue," the CM concluded.